Investing, Asset Allocation, Economics & the Search for the Bottom Line

Book Bits | 28 January 2017

● A Man for All Markets: From Las Vegas to Wall Street, How I Beat the Dealer and the Market
By Edward O. ThorpSummary via publisher (Random House)The incredible true story of the card-counting mathematics professor who taught the world how to beat the dealer and, as the first of the great quantitative investors, ushered in a revolution on Wall Street. A child of the Great Depression, legendary mathematician Edward O. Thorp invented card counting, proving the seemingly impossible: that you could beat the dealer at the blackjack table. As a result he launched a gambling renaissance. His remarkable success—and mathematically unassailable method—caused such an uproar that casinos altered the rules of the game to thwart him and the legions he inspired.
● The Great Leveler: Violence and the History of Inequality from the Stone Age to the Twenty-First Century
By Walter ScheidelSummary via publisher (Princeton University Press)
Are mass violence and catastrophes the only forces that can seriously decrease economic inequality? To judge by thousands of years of history, the answer is yes. Tracing the global history of inequality from the Stone Age to today, Walter Scheidel shows that inequality never dies peacefully. Inequality declines when carnage and disaster strike and increases when peace and stability return. The Great Leveler is the first book to chart the crucial role of violent shocks in reducing inequality over the full sweep of human history around the world.

● SUPERHUBS: How the Financial Elite and their Networks Rule Our World
By Sandra NavidiQ&A with author via finews.com
Q: You describe an extreme concentration of power – very few people in the same network can make decisions about everything. How dangerous is that?
A: Pretty dangerous, and the social stratification and resulting fragilty we are currently seeing are manifestations of that. Generally, systems that become too homogeneous become prone to malfunction, and when they don’t correct themselves, fail. Here, we have a microcosm of the same type of people, who all have the same education, the same information, think similarly, and operate interact with each other in echo chamber.

● In the Long Run We Are All Dead: Keynesianism, Political Economy, and Revolution By Geoff MannSummary via publisher (Verso)
A groundbreaking debunking of moderate attempts to resolve financial crises. In the ruins of the 2007–2008 financial crisis, self-proclaimed progressives the world over clamoured to resurrect the economic theory of John Maynard Keynes. The crisis seemed to expose the disaster of small-state, free-market liberalization and deregulation. Keynesian political economy, in contrast, could put the state back at the heart of the economy and arm it with the knowledge needed to rescue us. But what it was supposed to rescue us from was not so clear. Was it the end of capitalism or the end of the world? For Keynesianism, the answer is both. Keynesians are not and never have been out to save capitalism, but rather to save civilization from itself.

● The Fix: How Bankers Lied, Cheated and Colluded to Rig the World’s Most Important Number
By Liam Vaughan and Gavin FinchAdapted excerpt via The Guardian
The big flaw in Libor was that it relied on banks to tell the truth but encouraged them to lie. When the 150 variants of the benchmark were released each day, the banks’ individual submissions were also published, giving the world a snapshot of their relative creditworthiness. Historically, the individuals responsible for making their firm’s Libor submissions were able to base their estimates on a vibrant interbank money market, in which banks borrowed cash from each other to fund their day-to-day operations. They were prevented from deviating too far from the truth because their fellow market participants knew what rates they were really being charged. Over the previous few months, that had changed. Banks had stopped lending to each other for periods of longer than a few days, preferring to stockpile their cash. After Bear Stearns there was no guarantee they would get it back.

● The Cross-Border Family Wealth Guide: Advice on Taxes, Investing, Real Estate, and Retirement for Global Families in the U.S. and Abroad
By Andrew FisherSummary via publisher (Wiley)
The Cross-Border Family Wealth Guide is the long-awaited financial handbook for cross border families, with expert insight from a financial advisor who specializes in expat issues. Whether you’re an American living abroad, or foreign-born and living in the U.S., this book demystifies the complex issues surrounding the worldwide tax system, international information reporting, sensible investments, international real estate, and retirement planning. When your wealth crosses international borders, managing even the most mundane financial affairs can become wrought with time-consuming complexity; moving money, opening accounts, dealing with currency risks and translation, and setting up investments suddenly involves a whole new set of rules and regulations.

● Relationship Investing: Stock Market Therapy for Your Money
By Jeffrey S. WeissReview via Publishers Weeky
To best understand the stock market, treat your investments like your relationship with a beloved person, suggests former chief technical analyst Weiss in this slim, strained guide to removing fear and anxiety from the investing process. After a lifetime in stocks, he’s developed opinions on a wide variety of investing subjects, including risk management, handling the inevitable down times, playing the odds, and managing fees. Going light on advice and heavy on metaphor, Weiss speaks of the market as if it were a human being needing translation and conversation, an unevenly applied metaphor that never quite gel.

● Stress-Testing Your Savings: Your Financial Guide to Navigate to and Through Retirement
By Keith R. GebertSummary via Amazon
In Stress-Testing Your Savings, author Keith Gebert presents advice you can take action on today to diagnose your economic ailments and begin the journey to financial wellness. With over ten years of experience in the financial industry, Keith understands where many people struggle. Rather than consulting with a professional, so many families attempt to manage their own finances in addition to their busy lives at work and home. The result is often an inadequate, cookie-cutter plan that fails to account for their true needs.